The Central Bank Suspended The Repo Operation Again, And Took Care Of Monetary Liquidity In A Multi Pronged Way.

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< p > in the face of the normal contraction of money market liquidity under multiple factors, the central bank suspended the repo operation again on Tuesday (July 22nd).

This shows that the central bank's determination to maintain liquidity moderately loose and basically stable has not wavered.

The institutional analysis report points out that whether maintaining growth or reducing the cost of social financing, maintaining sufficient liquidity will become the basic orientation of monetary policy. Wide currency will last longer. Under this background, the trend of downside risk free interest rate has not been changed, and the value of investment after a moderate revaluation of bonds will be reappeared.

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< p > < strong > the central bank takes care of mobility under multiple management. < /strong > < /p >

< p > this Tuesday, the "a href=" http://www.91se91.com/news/index_c.asp "central bank" /a "did not carry out any open market operation, and the repo paction was suspended again after a month.

The last time the central bank suspended the repurchase was in June 26th. At that time, the liquidity of the money market tightened as it approached the mid year point of view, and the repurchase suspension stopped playing a role in stabilizing the market sentiment.

At the moment, the situation of the money market is better than that at the end of June.

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Except for a slight tightening in some parts of the second half of June, most of the funds remained relaxed during the month of P.

Compared with June, there are many factors that interfere with the seasonality and timing of funds in July.

First, after the end of the quarter, the banking system needs to pay a large amount of deposit reserve at the beginning of the month; two, in July, the first quarter of the year, the enterprises turned over the previous quarter income tax, which made the new fiscal deposits more in that month. Three, in July, the state-owned big banks paid dividends; four, in July, the new shares were released again, and four new shares were purchased on Wednesday and four.

At the same time, in July, there were very few "liquidity" entries. In the first place, the funds for the open market were only 268 billion yuan in July and 422 billion yuan in June. Two, the increase in foreign exchange is still expected to remain low.

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Under the combined influence of the above factors, the money market interest rate continued to rise slightly after July. At present, the repo rate of each period is close to the peak at the end of June, and the short end is overnight. The long end, such as 1 months, 3 months, and other varieties, exceeds the highest level at the end of June.

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< p > traders said that the short-term capital side continued to be tight, and this week's public market was less mature, and the new stock purchase was coming.

According to Wind statistics, the open market has only 18 billion yuan expired this week, the lowest single week since April, and all expired on Tuesday.

The trader also said that even if the repo was suspended, the amount of capital invested was not large. Faced with the superimposed impact of short-term tax payment and purchase of new shares, it would probably be a drop in the bucket, so the market was more concerned about whether the central bank would have additional actions, such as whether the central bank would restart the reverse purchase on Thursday.

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< p > in addition, last Friday there was a rumour that the central bank had put liquidity through the standing loan facility (SLF).

Although SLF rumours are hard to prove, the central bank has had extra moves.

The central bank and the Ministry of finance will carry out the 50 billion yuan 3 month treasury cash deposit and tendering on Thursday, and will conduct treasury cash deposit operations for the second time in a month.

Wind data show that 15 days this month, there is a 50 billion yuan treasury cash deposit expired. On that day, the central bank and the Ministry of finance have continued to do so. This Thursday's treasury cash deposit operation is indeed "extra", which will provide effective replenishment for short-term market funds.

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< p > market participants said that in view of the central bank's multi pronged approach to care for liquidity, and the tightening of the current capital market was mainly caused by the disturbance of time factors, the duration would not be too long. It is expected that the market funds will gradually ease from next week.

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< p > strong > wide monetary structure will continue to < /strong > /p >

Since P July, there are some subtle changes in the market's expectations of future monetary policy, leading to a significant adjustment in the bond market led by interest rate bonds.

In June, the monetary and credit supply exceeded expectations, and the short-term economic stability of the economy became clearer, indicating that the probability of further easing of monetary policy in the narrow sense of liquidity level declined, while the money market continued to tighten in July, to a certain extent, it aggravated the market's cautious approach to policy and capital.

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< p > however, the central bank suspended the repo operation and raised the frequency of the treasury cash deposit operation, indicating that its determination to maintain the stability of the money market liquidity has not wavered.

Galaxy Securities pointed out that in July, the pressure of money market exceeded market expectations, but wide money would last longer.

Whether it is to maintain growth or reduce social financing costs and maintain sufficient liquidity will become the basic orientation of monetary policy.

CITIC Securities also proposed that in light of the recent documents issued by the CBRC, strict supervision and wide currency to reduce social costs and promote risk-free interest rates to move downward is still the main idea of the regulatory authorities.

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< p > for the bond market, some market participants pointed out that the downside risks still exist, and the fundamentals are far from being able to subvert the trend of the market. It is too early to talk about tightening monetary policy. In this context, if the capital market is expected to remain relatively loose and basically stable, the value of the bonds will be revalued after the moderate revaluation of the bonds.

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< p > Everbright Securities also points out that after the "a href=" http://www.91se91.com/news/index_cj.asp "financial" /a "crisis, the medium-term trend of the bond market has been gradually deepened by liquidity, while the explanatory power of the fundamentals has dropped significantly. The core driving factors of the medium and long-term bond market trend are gradually shifting from fundamentals to capital side, which has been strengthened after last year's" money shortage ".

The agency believes that at present, the cost of real economy is still high, and the tightening of funds is not conducive to the decline of capital costs. The possibility of large contraction in liquidity in the second half of this year is unlikely. After the current short term pullback, the yield of treasury bonds and national debt has fallen to 4.30% and 5.30% in 10 years. Even considering that the interest rate marketization promotes the upward movement of the central government, it also belongs to a neutral high level.

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